What is HRIS (Human Resource Information System): Types and Implementation

Have you wondered what life would be like without automation? 

Imagine endless production lines operated by human hands, mountains of paperwork documenting employee data, and manual payroll calculations on Excel sheets. Sounds slow and inefficient, doesn’t it? 

This is the reality that an HR professional would face without an HRIS. Human Resources Information System is an automation wonder that streamlines HR operations by managing essential information through interconnected databases. 

If you’re curious about how an efficient HRIS can transform your organization, join us in this blog as we explore its meaning, types, and implementation process. 

What is Human Resource Information System (HRIS)? 

Human Resource Information System, also known as HRIS, is software that efficiently manages and stores critical employee information, reducing manual HR tasks by automating processes. It also enables employees to access their personal information and the organizations HR policies and procedures. 

HRIS Definition 

Gill and Johnson define HRIS as “a process that utilizes information technology for the effective management of human resources functions and applications. It is a computerized system comprising of data base or interrelated data base that track employees and their employment specific information.” 

Similarly, Hendrickson defines HRIS as “integrated systems used to gather, store, and analyze information regarding an organization’s human resources.” 

These definitions highlight that an HRIS is a comprehensive system for acquiring, storing, manipulating, analyzing, retrieving, and distributing relevant information about an organization’s human resources. 

Next, we’ll explore the key objectives of an HRIS. 

Key Objectives of HRIS 

Human Resource Information systems play a crucial role in automating HR processes and enhancing organizations’ operational efficiency.  

Here are the five key objectives of human resource information systems: 

• Provide comprehensive functionality 
• Act as a valuable reporting tool 
• Increase the operational efficiency 
• Improve risk management 
• Empower the workforce 

Let’s discuss these key objectives below. 

Provide comprehensive functionality

HRIS is a robust system that automates the HR’s daily tasks by storing essential information in a single database. It enhances communication and workflow among various departments and enables HRs to contribute significantly to budgeting and strategic planning. 

Act as a valuable reporting tool 

HRIS improves the quality of decisions by providing accurate HR analytics and predictions. It empowers managers to assess and track employee information effectively. 

Increase the operational efficiency 

By handling administrative and paper-heavy tasks, HRIS allows HRs to create and implement policies, standardize business processes, and play an important role in strategic planning.  

Improve risk management 

HRIS helps HRs comply with regulatory changes by automating data collection and policy updating. This ensures the integrity of sensitive information and compliance with governmental requirements. 

Empower the workforce 

HRIS includes an Employee Self-Service (ESS) portal, empowering employees to access and update their information. This reduces the burden on HR and provides managers with valuable team information. 

In conclusion, HRIS is an efficient software system that reduces the HR department’s manual workload. It transforms HR into a decision-making center that makes data-driven decisions, essential in strategic planning. But have you wondered what its key components are, let’s discover them below. 

What Are the Components of HRIS? 

With the evolution of technology, we stand at a juncture where every aspect of an organization’s operation is undergoing significant change, and so is the HR department. 

So, the six components of an HRIS are: 

• Database 
• Time and Attendance Management 
• Payroll and Expense function 
• Benefits 
• Employee interface 
• Recruitment and retention 

They are discussed below: 

Database 

HRIS acts as a centralized database to store all the critical employee information, like compensation history, emergency contact details, insurance details, and performance reviews. This functions as an alternative to huge paper files and documents. 

Time and Attendance Management 

Time and attendance management is one of the most time-consuming, yet essential functions of HR. HRIS automates this process by letting employees request leaves, and managers approve them without HR intervention. This process is also integrated with the payroll system, reducing errors and miscalculations. 

Payroll 

HRIS streamlines the entire payroll processing, reducing any instances of errors, and assists HRs in improving their tax compliance for locations with multiple tax levels and regulations. 

Employee interface 

HRIS lets employees update their personal information, review their pay scale, change their benefits plans, and other information directly in the system with limited access, reducing the additional burden on the HR department. 

Recruitment and Retention 

HRIS helps attract and retain the organization’s existing talent, ensures competitive pay, positive culture, and upskilling programs, and gives HRs all the necessary data to ensure sustained profitability and growth. 

Thus, these are the important components of an efficient HRIS, but have you wondered about the system’s internal processes? 

Curious to find out? 

Here is a detailed description of the internal components of an HRIS: 

• Input: Gather employee information and process it using predefined values. Modern systems store document images, including signatures and handwritten notes, using scanning techniques. 
• Data maintenance: Update data as change occurs, incorporating new information into the system and storing old data as historical information. 
• Output: This is essential as it generates valuable output for the users (especially the HRs) in the form of reports and presentations. 

Now that the core components and the internal components of an HRIS are clear, let’s delve into the next section. 

HRIS vs HRMS vs HCM vs HXM 

Aren’t all of them the same?  

Well, they are closely related, but the world of HR technology is extremely confusing when it comes to acronyms. HRIS, HRMS, HCM, and HXM – they all are the key behind efficiently managing your workforce, but what sets them apart? 

Let’s try to find the answer to this question. But before that let’s know the basic meaning of these terms: 

• HRIS (Human resource information system): A software system that stores and manages all your employee data, like payroll information, benefits packages, and personal details, acting as the central hub of all employee records. 
• HRMS (Human resource management system): It is a level higher than HRIS as it offers additional functionalities like applicant tracking, onboarding tools, and performance management, enhancing the operational efficiency of the HR department. 
• HCM (Human capital management): It goes beyond software, and encompasses every aspect of employee management, like talent acquisition, employee engagement, workforce analytics, and learning management system, making HRs strategic business partners. 
• HXM (Human experience management): It places a strong emphasis on employee experience and creates a positive and engaging work environment by using tools like employee feedback surveys, career development programs, and wellness programs, creating a work environment that attracts, retains, and motivates top talent. 

Now, with all confusions cleared let’s move to the next section and find out the various types of HRIS. 

Types of HRIS 

While it’s clear that HRIS is a software system programmed to simplify the lives of HRs, you must be aware of the various types of HRIS available in the market to gain a comprehensive understanding of the system. 

HRIS are of four types, specifically: 

• Operational HRIS 
• Tactical HRIS 
• Strategic HRIS 
• Comprehensive HRIS 

Let’s discuss these 4 types of HRIS in depth below. 

Operational HRIS 

These HRIS are solely concerned with handling routine and repetitive tasks, such as collecting and updating the system information on the employee positions and governmental regulations. It acts as the first level of efficiency among data management systems. 

Tactical HRIS 

These systems help HRs in resource decision-making by tracking recruitment information, job analysis, job design, training and development, and compensation. 

Strategic HRIS 

They help in offer negotiations, workforce planning, and the entire strategic planning part of the HR’s role. They are at the next level in HRIS, which allows organizations to frame their policies and make critical strategic decisions. 

Comprehensive HRIS 

They consist of an integrated database of employee files, positions, skills inventory files, job analysis and design files, etc., that helps generate comprehensive reports that aid decision-making. 

Thus, the four different types of HRIS serve different roles in an organization. Companies choose the type of software that satisfies their requirements and their business environmental conditions. With the distinction of various types of HRIS clear in your mind, let’s move onto the next section. 

Traditional vs Modern HRIS 

Over a decade ago, HR teams stored all their employee records in paper–printed files and huge rooms, but technological advancement has rendered this approach unsustainable. This paved the way for modern HRIS, which leans more towards the art of human management and gives businesses a competitive edge. By creating a centralized platform for all HR information while reducing all the additional manual tasks and paperwork, businesses worldwide have grown accustomed to HRIS. 

Now, let’s take a glance at the key differences between traditional and modern HRIS: 

Thus, this table clearly differentiates between a traditional HRIS and a modern HRIS. Now, let’s delve deeper into the next section. 

Benefits of an HRIS 

You cannot mandate productivity; you must provide the tools to let people become their best.

– Steve Jobs

HRIS is a tool that enhances the productivity of your workforce and offers certain other benefits to all parties involved. 

Kovach listed down the following advantages an HRIS brings along with itself to your company: 

• Increased competitiveness by improving HR operations. 
• Ability to implement various HR strategies. 
• Shift from transactional to strategic human resource information. 
• Include employees as an active part of the HRIS. 
• Reengineering the entire human resource department. 

Let’s look at other key benefits an HRIS offers to management, HR department, and the employees. 

Benefits for Management: 

• Enhances the overall efficiency of decision-making process. 
• Better resource allocation and budget control. 
• Clear vision of business strategy along with transparency in the process. 
• Sharp insights on employee retention and talent management. 

Benefits for HR department: 

• A single platform to access all the necessary employee information. 
• Eliminate slow, manual, and paper heavy tasks and processes. 
• Regularly updated system that stays compliant with changing statutory requirements. 
• Improved management system with faster operational efficiency. 
• Standardization of business processes, irrespective of the location, positions, or job roles. 

Benefits for Employees: 

• Time-saving and 24/7 availability. 
• Boosts morale and productivity. 
• Self-service portal to access and edit personal information. 
• Upskill oneself with skills and knowledge via internal personalized training courses. 

Thus, an HRIS offers many essential benefits to the organization’s three key stakeholders. Let’s find out how to implement an HRIS in your organization. 

Implementation of HRIS

HRIS implementation undergoes three key stages: 

• Adoption Phase 
• Implementation Phase and  
• Institutionalization Phase 

Let’s understand these three phases in depth below. 

Adoption Phase 

In this phase, organizations conduct a needs assessment to determine their key requirements, technical specifications, and information storage and access policy. After this, companies send out RFPs (request for proposals) to vendors and schedule demos of the available options in the market. Then, they choose the system that aligns with their needs assessment, budget, and management guidelines. Organizations then move on to the implementation phase. 

Check out: The Top HR Software in the market 

Implementation Phase 

In this phase, the company selects a project team comprising change management consultants that guide them throughout the implementation of the new software. This team is led by a senior project manager and consists of subject matter experts from HR and payroll departments, and their key role is to ensure the smooth implementation of the system. Then the organizations move on to the final institutionalization phase. 

Institutionalization Phase 

In the final stage, companies reap the system’s benefits by training key stakeholders (i.e., managers and employees). Training programs are organized to ensure that the whole transition system is smooth and without any process disruptions. Once trained, all the employees are fully competent in handling the system. 

Thus, by following these guidelines you can implement an HRIS in your company, boosting the overall efficiency and productivity of your workforce and the profitability of your business. 

5 Best Practices for Effective Management of HRIS 

While organizations implement an HRIS, they often overlook the system’s basic operational necessities that, overtime, reduces its efficiency. Here are the five best practices for effective management of your HRIS with common pitfalls to avoid: 

Regular Data Audits 

Conduct data audits at regular intervals to identify the common errors or inconsistencies in the system and ensure accurate data for effective decision-making. 

Training and Support 

Frame adequate training modules for new users and ongoing support for the existing users, ensuring smooth system implementation of the system and effectively managing the operational changes. 

Data Security Measures 

Adopt robust data security measures to protect sensitive employee information, including strong passwords, encrypting data, and restricting access to sensitive information to authorized personnel only. 

Integration with Other Systems 

Streamline processes, reduce task duplication, and improve overall efficiency by integrating your HRIS with other systems like leave and attendance, payroll, and performance management systems. 

Regular System Updates 

Always maintain the latest version of your HRIS software to ensure it runs smoothly and is protected against common system vulnerabilities. 

Hence, these practices help maintain your HRIS systems in the best condition and increase the overall ROI, improving the decision-making process, enhancing operational efficiency, and sustaining the business in the long run. 

Wrapping It Up 

HRIS systems reduce manual tasks and replace them with automated processes, saving time and extra effort. This additional focus on manual tasks can significantly limit an HR’s ability to concentrate on strategic planning and employee engagement. Imagine the amount of time freed that’s currently spent on data entry and paperwork. They also empower data-driven decision-making, allowing HR professionals to focus on strategic initiatives that drive the profitability and productivity of business. 

See the difference HRIS can make? Keka HR, a leading provider of user-friendly HRIS solutions, offers a comprehensive platform designed to automate tasks, centralize data, and empower strategic decision-making. Schedule your free Keka demo today and see the change in your processes! 

Frequently Asked Questions (FAQs) 

What is HRIS? 

HRIS (Human Resource Information System) is software that automates HR processes, centralizes HR data, streamlines processes, and improves organizational efficiency. 

What are the key features of HRIS? 

The key features of HRIS include employee data management, payroll and benefits administration, attendance tracking, performance evaluation, and recruitment and training management. 

How does HRIS benefit organizations? 

HRIS helps in streamline HR processes, enhance data accuracy, facilitate compliance, and enable better decision-making with real-time data. 

Can HRIS integrate with other business systems? 

Yes, HRIS can integrate with other business systems, such as payroll, accounting, and CRM software to improve efficiency across the organization. 

Is HRIS suitable for small businesses? 

Yes, HRIS offers benefits like streamlined payroll processing, data organization, and cost-effectiveness making it an ideal choice for small businesses. 

How does HRIS enhance employee self-service? 

HRIS enhances employee self-service by offering features like leave requests, access to company policies, updating personal information, and reducing HR’s daily administrative burden.